Waste-to-Energy : Covanta and EQT Infrastructure to create sustainable waste solutions provider

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Covanta Holding Corporation, a world leader in sustainable waste and energy solutions, announced the completion of its $5.3 billion acquisition by the EQT Infrastructure V fund, unveiling its strategy to become the most sustainable provider of waste solutions. Covanta also announced the appointment of Azeez Mohammed as President & Chief Executive Officer.

Mr. Mohammed will work closely with Covanta’s full team, EQT, and the company’s new Board of Directors to embark on a bold program to generate compelling value for all stakeholders in an increasingly circular economy. As part of this commitment, the deal was completed with the first ever sustainability-linked leveraged buyout (“LBO”) financing in the U.S., featuring environmentally focused KPIs with financial incentives attached to drive meaningful progress.

Strategic Initiatives

Building on Covanta’s strong foundation as a leader in the WTE industry, EQT Infrastructure will increase investments across the business, including:

Leveraging its existing asset base to move higher up the waste value chain by further incorporating recycling, beneficial reuse, and other forms of sustainable waste disposal into its service offering (including building materials and energy feedstocks)

Upgrading equipment at existing plants to reduce emissions (including baghouses and advanced NOx and SOx control)

Furthering investments in host communities (including vocational training programs and environmental undertakings)

First Ever Sustainability-Linked LBO Financing in the U.S.

Covanta’s sustainability-linked financing framework partners its sustainability strategy with its corporate financial strategy. Under the framework, Covanta pledges to meet two long term goals to increase the total WTE processed, as well as waste recycled to reused materials, by 40 percent by 2030. These long-term goals are underpinned by two accompanying KPIs, which must be met by year-end 2025, compared to a 2020 baseline. The company would face significant financial penalties if it fails to meet the following targets:

Demonstrating a cumulative growth of 2.5 percent of sustainably processed waste, which diverts more waste from landfills, therefore avoiding significant methane emissions

Showing a 25 percent cumulative growth in waste recycled or reused, which also avoids emissions, as well as supports the development of the circular economy

The KPIs reflect Covanta’s greatest net emissions reduction potential. By leveraging sustainable waste management, Covanta’s facilities generate energy and avoid landfills, which produce methane, a potent greenhouse gas that is responsible for more than a quarter of today's global warming. Increasing waste recycled or reused optimizes waste output and contributes to the circular economy.

Covanta tracks its long-term sustainability goals and annually publishes a report highlighting its progress and continued commitment to Environmental, Social and Governance initiatives. Alongside today’s closing announcement, Covanta released its 2021 Sustainability Report, which includes 2020 full-year data and in-depth analysis. Reported progress includes reduced greenhouse gas emissions, more waste diverted from landfills and expanded company-wide employee resource groups.

New President & CEO Azeez Mohammed

Mr. Mohammed brings over 24 years of leadership experience at large global business units, including at major industrial companies. Most recently, he served as Executive Vice President at Bloom Energy where he was responsible for helping countries and customers make the transition from a fossil fuel to a renewable hydrogen economy. Prior to this position, he served as President & CEO of multiple Power & Energy oriented business units within GE including GE Power Conversion, GE Power and GE Energy Services. His scope included P&L responsibilities for units of several billions of dollars, thousands of employees and a large global footprint. He has broad functional expertise in technology, finance, and operations and has worked in dozens of different industry segments, including sustainability sectors such as solar, hydrogen, and electric vehicle charging. He is also a global player having lived and worked in six states in the United States and seven countries worldwide.